Did you know that messing with old collections can be the worst thing you can do and can lower your credit score?
There are many misconceptions about credit scores out there. There are customers who believe that they don’t have a credit score and many people who think that their credit scores just don’t really matter. These sorts of misconceptions can hurt your chances at some jobs, at good interest rates, and your chances of getting approved to buy a home.
FICO scores range from 300-850 and in general, the higher your credit score, the more likely you are to be given credit at great rates. Scores in the low 600s and below will often give you trouble in finding credit, while scores of 720 and above will generally give you the best interest rates out there. However, credit scores are a lot like GPAs or SAT scores from college days – while they give others a quick snapshot of how you are doing, they are interpreted by people in different ways. Some lenders put more emphasis on credit scores than others. There is much to learn about credit and I have lots of free resources to help you understand your credit situation!
There are over 100 good credit practices to raise and keep your credit score however, in general, you will want to follow at least four steps to better credit scores:
1) Check your credit report and credit scores. Assess your current situation and make sure to
correct any errors on your report by writing to the credit bureaus and to the creditors
involved. Immediately report any charges you don’t recognize – these may indicate an error
but they might also indicate that you have been the victim of fraud or identity theft.
2) Pay down your debts and pay your bills on time. Close down the shorter-term loans if
you need to (this does not include your revolving credit such as credit cards).
3) Do all you can to make good financial habits automatic in order to keep your credit rating good.
4) Address particular issues – such as too much debt or a student lifestyle – that you think may be contributing to your low credit rating.
Contact me for the full list of 101 Credit Tips!
